In Canada, the sector gained nearly five per cent as several cannabis stocks surged following the resignation of marijuana critic U.S. Attorney General Jeff Sessions. Aurora Cannabis closed up almost nine per cent, Canopy Growth Corp. eight per cent and Aphria Inc. 3.7 per cent.
South of the border, Tilray Inc. gained more than 30 per cent on Nasdaq.
The American health sector also got a boost as divided government signalled that Republican attempts to repeal Obamacare will now be stalled, says Michael Currie, vice-president and investment adviser at TD Wealth.
“A Democratic victory means there’s very little chance of Republicans repealing Obamacare and that’s good news for the insurers,” he said in an interview.
The biggest gainers on the Dow Jones industrial average were large insurers like Anthem Inc. and Humana Inc., along with drug giants Merck and Pfizer.
“Just the fact that it’s a split House or gridlock means that it’s unlikely that either party will make any big inroads to fighting the big pharmaceutical companies over drug prices.”
In New York, the Dow Jones industrial average was up 545.29 points at 26,180.30. The S&P 500 index was up 58.44 points at 2,813.89, while the Nasdaq composite was up 194.79 points at 7,570.75
The election results were in line with market expectations and avoided the worst scenario of the Democrats gaining control of both houses of Congress.
“There is a consensus that Trump’s policies have been favourable to the market,” said Currie.
The fear of investors was that a Democratic wave would lead to the repeal of tax cuts that have been very favourable for U.S. stocks and reinstatement of regulations.
“Basically undoing some of his pro-growth policies.”
Technology stocks also gained as they sustained the largest decreases during the recent pullback.
The S&P/TSX composite index closed up 76.72 points to 15,369.43.
The increase on Canada’s main stock index was less than expected, in part, because the health-care and tech sectors are a very small part of the exchange.
“It is disappointing to see that even right now we’re only up barely a third of the increase we’ve seen on New York and there really hasn’t been any great weak areas dragging Canada down. We didn’t expect to see as much a jump but I would have expected to see at least higher than this.”
The Canadian dollar traded at an average of 76.36 cents US compared with an average of 76.16 cents US on Tuesday.
The December crude contract was down for an eighth straight day, falling 54 cents at US$61.67 per barrel and the December natural gas contract was unchanged at US$3.55 per mmBTU.
Crude initially rose Wednesday on reports that Saudi Arabia was planning to increase production, but they fell after U.S. President Donald Trump said during a news conference that he wants prices to remain low.
The December gold contract was up US$2.40 at US$1,228.70 an ounce and the December copper contract was up 2.2 cents at US$2.75 a pound.
Ross Marowits, The Canadian Press